Sh. Rajbir Singh, Patiala V. ITO, Patiala

ITA 12/CHANDI/2016

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8484 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 11-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: H R SALDI
• Keywords: Opportunity of being heard; Condonation of delay
• Section: 2

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES SMC CHANDIGARH BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT ITA NO. 12/CHD/2016 ASSESSMENT YEAR: 2007-08 SH. RAJBIR SINGH, VS. THE ITO S/O SH. KULWANT SINGH, WARD-1 1287/3 RAGHO MAJRA PATIALA PROP.M/S GREEN VIEW AQUARIUM , BASEMENT A.C. MARKET PATIALA PAN NO. ACFPS0936A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI. H.R. SALDI RESPONDENT BY : SHRI S.K. MITTAL DATE OF HEARING : 22/02/2016 DATE OF PRONOUNCEMENT: 22/02/2016 ORDER PER H.L.KARWA, VP THIS APPEAL HAS BEEN FILED BY THE ASSESSEE IS DIREC TED AGAINST THE ORDER OF CIT(A), PATIALA DT. 16/09/2015 RELATING TO ASSESSME NT YEAR 2007-08. 2. IN THIS APPEAL THE ASSESSEE HAS RAISED THE FOLLO WING GROUNDS: 1. THAT THE LD. CIT(A) PATIALA HAVE ERRED IN CONFIR MING THE ADDITION OF RS. 3,58,703/- ON ACCOUNT OF ALLEGED SUPPRESSION OF PRO FIT WHICH IS ILLEGAL BAD IN LAW AND AGAINST THE FACTS OF THE CASE, HENCE IS LIABLE TO BE DELETED. 2. THAT THE LD. AO AS WELL AS LD. CIT(A) PATIALA HA S WRONGLY TREATED THE DEPOSIT IN BANK AS SALE PROCEED OF THE APPELLANT WI THOUT GIVING CREDIT OF WITHDRAWAL AND RE-DEPOSIT IN THE BANK. 3. THAT THE LD. CIT(A) PATIALA HAVE ARBITRARILY CON FIRMED THE NET PROFIT AT 20.92% ON THE ALLEGED TOTAL DEPOSIT IN THE BANK, EV EN WITHOUT DEDUCTING THE WITHDRAWAL AND RE-DEPOSIT. 4. THAT THE LD. CIT(A) PATIALA HAVE ERRED IN CONFIR MING NET PROFIT AT 20.92% WHICH IS HIGHLY EXCESSIVE AND SHOULD HAVE APPLIED A T 5% U/S 44AF. 2 3. IT IS OBSERVED THAT THE APPEAL FILED BY THE ASSE SSEE IS LATE BY 31 DAYS. THE APPELLATE ORDER PASSED BY THE CIT(A) WAS RECEIVED B Y THE ASSESSEE ON 12/10/2015, AND AS PER THE PROVISIONS OF LAW, THE A SSESSEE WAS REQUIRED TO FILE THE APPEAL ON OR BEFORE 11/12/2015. HOWEVER, THE AS SESSEE SUBMITTED THE APPEAL ON 11/01/2016, AND HENCE THERE WAS A DELAY O F 31 DAYS IN FILING OF FILE. THE ASSESSEE HAS SUBMITTED AN APPLICATION FOR CONDO NATION OF DELAY STATING THAT HE HAS LEFT THE PLACE OF RESIDENCE AND BUSINESS ALM OST THREE YEARS AGO AND AT PRESENT HE IS STAYING IN GURUDWARA GOBIND MARG, VIL LAGE PAKHI, DISTT. CHAMOLI (UTTRAKHAND). IT IS FURTHER STATED THAT HE IS WORKI NG IN GURUDWARA SAHIB AS A VOLUNTEER SEWADAR FOR THE LAST THREE YEARS AND RARE LY COMES TO PATIALA. THE DELAY OF ONE MONTH IN FILING THE APPEAL WAS DUE TO THE REASON THAT THE DOCUMENTS AND FORMS RELATING TO FILING OF APPEAL WE RE SENT TO THAT PLACE FOR OBTAINING HIS SIGNATURE. THE DOCUMENTS SENT THROUGH POST DID NOT REACH THE DESTINATION IN TIME AND BACK WHICH CAUSED DELAY. AC CORDING TO ASSESSEE THERE WAS NO MALAFIDE INTENTION IN NOT SUBMITTING THE APP EAL IN TIME. IN SUPPORT OF THE ABOVE CONTENTION, THE ASSESSEE HA S ALSO SUBMITTED AN AFFIDAVIT. THERE IS NO MATERIAL ON RECORD TO CONTROVERT THE AB OVE CONTENTION OF THE ASSESSEE. THE EXPLANATION GIVEN BY THE ASSESSEE APP EARS TO BE COGENT AND SATISFACTORY. AT THE SAME TIME IT IS WELL SETTLED LAW THAT JURISDICTION TO CONDONE THE DELAY SHOULD BE EXERCISED LIBERALLY. THE MATTER RELATING TO CONDONATION OF DELAY SHOULD BE JUDGED BROADLY AND NOT IN PEDANTIC MANNER. CONSIDERING THE ENTIRE FACTS AS STATED HERE IN ABOVE I AM FULLY SAT ISFIED WITH THE EXPLANATION GIVEN BY THE ASSESSEE FOR THE DELAY IN FILING THE A PPEAL. ACCORDINGLY, I CONDONE THE DELAY IN FILING THE APPEAL. 2. AS REGARDS THE MERITS OF THE CASE THE BRIEF FACT S ARE THAT THE ASSESSEE IS RUNNING THE BUSINESS OF AQUARIUM. THERE WAS SOME DE POSITS AND RE-DEPOSITS IN THE BANK ACCOUNT OF THE ASSESSEE OUT OF WHICH SOME PAYMENTS WERE MADE TO M/S BLOSSOM AQUARIUM AT HOWRAH(CALCUTTA) FROM WHOM THE GOODS WERE BEING PURCHASED. FOR THE ASSESSMENT YEAR UNDER CONSIDERA TION THE ASSESSEE DECLARED 3 GROSS RECEIPTS AT RS. 4,76,850/- AND THE NET PROFIT @ 20.92% WHICH COMES TO RS. 99,800/-. DURING ASSESSMENT PROCEEDING THE ASSESSIN G OFFICER NOTICED THAT TOTAL RECEIPTS (CASH DEPOSITS) AS PER THE BANK ACCOUNT AN D FROM THE LEDGER ACCOUNT OF THE ASSESSEE IN THE BOOKS OF M/S BLOSSOM AQUARI UM HOWRAH WERE TO THE TUNE OF RS. 21,91,701/-. THEREFORE THE ASSESSING OFFICER ESTIMATED NET PROFIT @ 20.92% AT RS. 4,58,403/- AND AFTER REDUCING NET PROFIT SHO WN BY THE ASSESSEE, AN ADDITION OF RS. 3,58,703/- WAS MADE. 4. ON APPEAL THE CIT(A) CONFIRMED THE ADDITION, AND HENCE THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. I HAVE HEARD SH. H.R. SALDI THE LD. COUNSEL FOR THE ASSESSEE AND SH. S.K. MITTAL LD. DR AT LENGTH AND HAVE ALSO PERUSED THE M ATERIALS AVAILABLE ON RECORD. 6. LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT DU RING THE FINANCIAL YEAR RELEVANT TO ASSESSMENT YEAR UNDER CONSIDERATION, A SSESSEE MADE THE PAYMENT OF RS. 10,43,619/- TO M/S BLOSSOM AQUARIUM AND ALS O MADE CASH PAYMENT TO THE TUNE OF RS. 2,76,260/- TOTALING TO RS. 13,19,879/-. 7. AT THE TIME OF HEARING OF APPEAL LD. COUNSEL FOR THE ASSESSEE DID NOT DISPUTE THE NET PROFIT RATE OF 20.92% APPLIED BY TH E AO. THE ONLY CONTENTION RAISED BY THE LD. COUNSEL FOR THE ASSESSEE WAS THAT THE ASSESSEE HAD PAID A SUM OF RS. 10,43,619/- THROUGH BANKING CHANNEL AND RS. 2,76,260/- AS CASH PAYMENT TO M/S BLOSSOM AQUARIUM, HOWRAH. 8. IN VIEW OF THE ABOVE SH. H.R. SALDI LD. COUNSEL FOR THE ASSESSEE, SUBMITTED THAT THE ORDER OF THE LD. CIT(A) MAY BE SET ASIDE A ND REMAND THE MATTER BACK TO THE AO FOR A LIMITED PURPOSE TO VERIFY THE ABOVE CONTENTION OF LD. COUNSEL FOR THE ASSESSEE AND TO DECIDE THE ISSUE AFRESH IN ACCO RDANCE WITH LAW. IT IS MADE CLEAR THAT THE LD. COUNSEL FOR THE ASSESSEE DID NOT DISPUTE THE NET PROFIT RATE OF 20.92% AS APPLIED BY THE AO. THE AO SHOULD GIVE AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 4 9. IN VIEW OF THE ABOVE, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 22/02/2016. SD/- (H.L.KARWA) VICE PRESIDENT DATED : 22/02/2016 AG COPY TO:1. THE APPELLANT,2. THE RESPONDENT,3.THE CI T, 4.THE CIT(A),5. THE LD. DR